Spain's Princess Cristina goes on trial for tax fraud

CUENCA Madrid - Spain's Princess Cristina, the sister of King Felipe VI, and her husband will go on trial Monday for corruption in a high stakes case likely to further damage the monarchy's image.

The highly anticipated trial of the royal couple and 16 other accused will run until June at a court in Palma, on the Mediterranean island of Mallorca, where the Spanish royal family has a seaside holiday home.

Cristina, 50, will be the first direct member of the royal family facing criminal charges since the monarchy was reinstated following the death of dictator General Francisco Franco in 1975.

The case is centred on the shady business deals of the Noos Institute, a charitable organisation based in Palma which her husband, former Olympic handball player Inaki Urdangarin, chaired from 2004 to 2006.

As a result of their indictment, last year, King Felipe VI, who took over from his father Juan Carlos in June 2014, stripped Cristina and her husband of their title as Duke and Duchess of Palma de Mallorca, in a bid to undo damage to the monarchy's image ahead of the trial.

Juan Carlos had given the couple the title when they married in 1997 in a lavish ceremony at the height of the popularity of the Spanish royals.

"Felipe VI cannot allow there to be the slightest doubt over the rigour of his sister's trial," historian Pilar Urbano, who has written extensively about the royal family, told AFP.

The trial must be "exemplary, the opposite would hurt him," she added.

Urdangarin, 47, and his former business partner Diego Torres are suspected of embezzling 6.2 million euros (S$9.7 million) in public funds paid by two regional governments to the Noos Institute to stage sports and other events.

He is accused of using his royal connections to secure inflated contracts without competing bids and siphoning off some of the money into Aizoon, a firm he jointly ran with his wife Cristina to fund a lavish lifestyle.

Once dubbed the "ideal" son-in-law by Spain's gossip press, Urdangarin has also been charged with influence peddling, document falsification, money laundering and tax fraud.

Cristina, a mother-of-four with a master's degree from New York University, faces the lesser charge of tax evasion.

The examining magistrate in the case tried for years to prove her active involvement in her husband's business dealings.

But he ran into the firm opposition of public prosecutors who managed to get her cleared of accusations of money laundering.

The case was triggered by a complaint from anti-graft campaigners "Manos Limpias" or "Clean Hands". Public prosecutors and the tax office both declined to press charges against her.

Urdangarin faces a 19-and-a-half-year jail sentence. If convicted Cristina faces a jail term of up to eight years.

The first days of the trial will be spent on procedural matters. The accused will start being questioned on February 9 with Cristina last on the list to testify.

The princess, the sixth in line for the throne, has denied wrongdoing. During a preliminary hearing in February 2014 she told the court that she trusted her husband to manage their finances and repeatedly answered "I don't know" to questions.

Her lawyers are expected to ask the court to apply the so-called "Botin doctrine" to her.

In a 2007 case against the late Emilio Botin, the former chairman of Santander bank, the Supreme Court ruled that people can not be tried without the support of the public prosecutor.

Applying this jurisprudence to the princess "would give the impression that justice is not equal for all," said Urbano.

The princess, who now lives in Switzerland, has kept a low profile ahead of her trial. She has been excluded from the royal family's official functions and was not even invited to her brother Felipe's swearing in ceremony in June 2014.

Whether she gets the case against her dropped or stands trial until the end, the monarch's reputation will take a hit, Jose Apezarena, author of several books about Felipe, told AFP.

"Like it or not, it will hurt the monarchy," he said.